Posted on 07/05/2011 11:02:22 AM PDT by CedarDave
New Mexico’s Rail Runner Express could be on track for a fiscal train wreck.
... the need to address a projected $1.2 million shortfall in the train’s operating budget for the fiscal year that began Friday, was behind the controversial decision to discontinue weekend service.
Los Ranchos Mayor Larry Abraham, vice chairman of the railroad’s governing board, said the move was a wake-up call about a looming financial crisis ...
Abraham also did some math in an op-ed piece he submitted to the Journal. Using current revenue, operation expense and debt service, he calculates the Rail Runner will have cost $1.3 billion but generated just $60 million in fares by the time bonds are paid off in 2027.
In the short term, tax revenues designated for the train and fares paid by riders fall short of even operating expenses. And the state, struggling with its own budget problems, is already paying millions of dollars in interest on the train each year.
The immediate funding hole is caused by the expiration of a federal clean air grant. The weekend service cut, which came on a 6-5 vote June 17, makes up for that.
But more problems are coming down the track.
In December, the Rail Runner will exhaust federal clean air funding that makes up about 23 percent of projected operating revenue this year. The loss will leave a $5.4 million hole in the budget, beginning in the fiscal year that starts July 1, 2012.
Abraham points out that fares, estimated at $3.2 million in fiscal year 2012, will cover only a small portion of the train’s approximately $23 million a year in expenses – and nothing toward interest and principal on the $450.8 million in bonds the state issued to purchase track and rolling stock.
(Excerpt) Read more at abqjournal.com ...
I’m numb with surprise.
Lotsa money for Fat Billy’s photo-op.
Something from Richardson’s (mis)administration is a boondoggle?! Colour me shocked! /srac
What's next, Segway user trails in Wyoming?
Somewhere Willie Green is crying.
That picture is what Lord Perry was pushing for the new toll road in Texas, except it was to be about 10 times as wide.
Install toll booths every two miles of Highway in New Mexico, with the toll cost to be higher than the train fare per mile.
That and offer happy endings for all riders of the male gender and free manicure services for the ladies.
Commuter trains can work in places where lots of people have easy access to them to get to and from work, ...
And, what’s missing here is the “mass” in mass transit. ... Though the train operates in the most populous part of the state, people have other options to get from point A to point B — and a 50-minute drive from Albuquerque to Santa Fe takes about an hour and a half on the train. Unfortunately, the Rail Runner heads north-south, while the pressing traffic demand in the Metro area is east-west.
As this venture runs out of steam, officials are faced with raising fares, increasing taxes — never popular with voters — and attracting more riders.
Without major changes, the Rail Runner faces becoming an expensive relic we’ll be paying off for a long time.
Editorial: Rail Runner Chugging Toward Reality Check
Comments on other forums are more specific -- This railroad was part of Richardson's scheme to enhance his environmental resume in his quest for the Democratic presidential nomination. And of course FR has been consistent (as have some others) in pointing out the financing problems with trying to run an expensive commuter rail system in a sparsely populated state (see keyword Richardson's Railroad ). For those out of state, ride some day between ABQ and Santa Fe and admire the unpopulated area between the two cities.
Yes they will be enclosed, climate controlled, solar and wind powered with toilets that convert waist to that burger we all read about the other day. Can’t lose in a win-win ya’ know. Best of all at 500k an employee think of all the jobs we’ll create!
NM list PING! Click on the flag to go to the Free Republic New Mexico message page.
(The NM list is available on my FR homepage for anyone to use. Let me know if you wish to be added or removed from the list. For ABQ Journal articles requiring a subscription, scroll down to the bottom of the page to view the article for free after watching a short video commercial.)
Think of the poor masses of New Mexicans wondering how they will ever get from Tucumcari to Truth and Consequences!
Oh, the humanity of it all!
It’s like an Anti-Atlas Shrugged with the “hero” forcing through the Wesley Mouch line.
Rules for developing nonsense projects of politicians. (1). If it can make money, the government doesn’t need to do it. Someone else will. (2). If government just has to pay for it, make sure it will generate enough revenues directly or indirectly, as in fees or growth in the infrastructure that brings in taxes, to pay for it. Like roads, electricity, water, and so on, things government gets involved in. (3). Slow trains in the 21st Century...? Don’t be stupid.
“What’s next, Segway user trails in Wyoming? “
or maybe peddle boat canals in Kansas.
But then again, we really don’t want to give the democRATS new ideas on how to spend our money.
Just tax the “rich” more. Problem solved. /Any Democrat
Stupidity....doing the exact same thing over and over, and expecting a different result. How many times must this mistake be repeated???
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.